Autobayng News Team
The move is expected to reduce prices of several goods and services, boosting consumption and aiding small businesses.“>
The Goods and Services Tax (GST) Council will meet in the capital on September 3-4 to decide on the Centre’s proposal for a simplified two-rate structure of 5 per cent and 18 per cent, with a special 40 per cent levy for sin goods.According to an office memorandum sent to states and union territories, the council — comprising central and state finance ministers — will also consider exempting individual life insurance products, Economic Times reports. A meeting of officers from both Centre and states is scheduled on September 2 to firm up inputs for the council.The proposed reform, part of the next-generation GST roadmap, includes scrapping the 12 per cent and 28 per cent slabs, removing the compensation cess, and correcting inverted duty structures. The government aims to roll out the changes in time for Diwali, following Prime Minister Narendra Modi’s Independence Day announcement of GST reform as a “Diwali gift.”The move is expected to reduce prices of several goods and services, boosting consumption and aiding small businesses. Experts estimate an immediate revenue loss of around ₹45,000 crore in the current financial year, though they expect medium-term gains from higher demand.“The proposed shift of most items from 12 per cent slab to 5 per cent and from 28 per cent to 18 per cent promises tangible relief for households and MSMEs while aligning with the government’s broader agenda of growth and financial inclusion,” said Manoj Mishra, partner, Grant Thornton Bharat LLP.However, he cautioned that careful calibration would be needed to maintain revenue neutrality and avoid inflationary pressures.
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